Which of the Following Statements Is False

question 87

Multiple Choice

Which of the following statements is false?

• A)Both stock splits and stock dividends increase the number of common shares issued.
• B)Both stock splits and stock dividends increase the number of common shares outstanding.
• C)Stock splits reallocate amounts between retained earnings and contributed capital accounts.
• D)Both stock splits and stock dividends have the impact of reducing the market price of the stock.

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Definitions:

Expense Account Balance

The total amount recorded as expenditures by a company within a specific period, awaiting reimbursement or allocation.

Income Summary

A temporary account used in accounting to transfer revenues and expenses, summarizing the net income or loss for a period before transferring the balance to retained earnings.

Owner's Capital

The amount of equity in a company that is directly attributable to the owner(s), representing their stake in the company’s assets after liabilities have been subtracted.

Revenue

Income derived from the core business activities of a company, specifically through selling products or services.